RoadPeace welcome High Court decision against the UK Government and the MIB over who receives compensation in personal injury claims involving non-road vehicles

7 November 2017

The law firm Leigh Day on behalf of the road victims’ charity RoadPeace have won a High Court legal challenge to the decision by the UK Government and the Motor insurers’ bureau (MIB) over who should receive compensation in personal injury claims involving non-road vehicles.

In a judgment in the High Court which was handed down today, 7 November 2017, Mr Justice Ouseley agreed that compulsory insurance cover should be extended to any use of a vehicle which is consistent with its normal function, including when motor vehicle incidents occurred on private land, such as private drives and farmyards.

As such, Mr Justice Ouseley considered that domestic rules should be brought into line with the EU Directive and a declaration of incompatibility should be made, with the possibility of a timetable for legislative change to follow.

RoadPeace, a national charity, providing support for road crash victims, also welcomed what is said were substantial concessions by the MIB following the instigation of legal action against what it claimed were unlawful agreements by the MIB which were incompatible with EU law.

The MIB exists for compensating innocent victims injured or killed by uninsured and/or untraceable drivers. It is estimated that uninsured and untraced drivers injure approximately 26,500 people every year and kill around 130. Every insurer providing motor insurance is obliged to contribute to the funding of the MIB.

The compulsory third party motor insurance requirement is set out in the Road Traffic Act 1988. Compensation for victims of road crashes involving uninsured or untraced drivers are governed by two ministerial schemes negotiated with the MIB: the Uninsured Drivers Agreement (UDA) and the Untraced Drivers Agreement (UtDA).

Lawyers for RoadPeace argued that current UK legislation unlawfully excluded some victims from any protection and/or unlawfully restricted the amount of compensation they are entitled to.

On these points, the High Court did not agree, and RoadPeace is considering seeking permission to appeal.

At the outset of the case, Leigh Day threatened the Government with legal action unless it looked again at the legislation, claiming that it was unlawful and fell short of EU Directive 2009/103/EEC which establishes the principles of ‘equivalence and effectiveness’ to these types of legal claims across EU member states.

The letter identified numerous additional breaches of the EU directive and common law, which it said it would challenge in the High Court if the Secretary of State did not address their concerns.

Specifically, RoadPeace argued that the MIB should compensate victims of uninsured and untraceable drivers injured anywhere, not just on roads or in a public place as suggested by the revised legislation.

During the course of Judicial Review proceedings by Leigh Day, the Secretary of State accepted a number of the grounds presented by Roadpeace, conceding that: the ‘geographic limit’ should be extended to ensure that the MIB should cover those injured ‘other than on roads or public places’; and a proposed terrorism extension (which would have seen those injured through an act of terrorism unable to make a claim through the MIB regardless of their injuries) was not permitted by the EU Directive.

Also, during the litigation the rules were changed so that all settlements on behalf of a minor must now be approved by an independent arbitrator.

Leigh Day continued to take legal action in the High Court over what it claimed were numerous additional infractions of EU law outlined in their original letter, as well as to obtain remedies for those who had become victims before the Secretary of State’s and MIB’s new rules had been implemented in light of the above concessions.

Following a hearing in February this year, today’s judgment was welcomed by both RoadPeace and Leigh Day.

The litigation resulted in major amendments to the rules, which the Secretary of State had not been minded to make otherwise, such as a more favourable definition of “significant personal injury” for victims of road traffic accidents.

Rowan Smith, solicitor in the public law team at Leigh Day who represented Roadpeace in these proceedings, said: “This judgment is a real vindicatation of all the effort RoadPeace, with limited means as a relatively niche NGO, has put into its long battle to bring the standards of UK compensation for victims up to stratch with the requirements of EU law. Where the High Court called for changes to the law, we will push for an ambitious timetable. Where we feel the High Court did not go far enough to protect victims, we will advise RoadPeace on a potential appeal.”

Vijay Ganapathy, a partner in the personal injury team also at Leigh Day, which represents many victims of uninsured and untraced drivers said: “It is estimated that around a million people are driving without insurance in England and Wales and every year thousands of people are injured by uninsured drivers – some very seriously.

“The EU directive provides that each member state should have a scheme whereby a person injured by an uninsured driver is treated no less favourably than if they had been injured by an insured driver.

“Unfortunately UK legislation and the MIB agreements have fallen short in many respects. In particular, the MIB have, in many cases, argued the above protection should only benefit those injured by certain types of motor vehicle even though the EU directive suggests otherwise.

“This has meant that many who been injured by uninsured drivers of other types of vehicles such as farm tractors have been denied compensation by the MIB. Thankfully therefore this judgment means the MIB are less able to advance this argument.”

Amy Aeron-Thomas, Advocacy and Justice Manager at RoadPeace, said: “This judgment is an important step forward in our campaign for justice for crash victims. Those bereaved and injured already suffer emotional, physical, and financial devastation. They should not be made to suffer more because the driver involved was uninsured or untraced. The least our society can do for these innocent crash victims is ensure they are compensated fairly and promptly. This judgment and the earlier concessions agreed by government will help deliver civil justice.”

Roadpeace were represented in the High Court by Jeremy Hyam QC and Hannah Noyce of One Crown office Row.